SHANGHAI, China — The NBA took another step toward expanding its presencein China on Wednesday, with the Orlando Magic defeating the Cleveland Cavaliers90-86 in an exhibition game behind Dwight Howard’s 31 points and 14 rebounds.

The game, featuring LeBron James and attended by NBA commissioner DavidStern, was played at Qizhong Arena on the outskirts of Shanghai. The teams playagain Saturday in the former Portuguese territory of Macau. On Thursday inMacau, the Magic face a Chinese all-star team, part of the NBA’s “ChinaGames.”

Jameer Nelson added 24 points for Orlando, while James led Cleveland with 17and Larry Hughes scored 16. James played only 28 minutes and Hughes 27, bothresting late in the game when Orlando rallied to take control.

Orlando tied it 84-84 on Howard’s inside basket with 1:16 to play and thendrew away, with Nelson hitting four of four free throws down the stretch.

Orlando trailed 46-42 at halftime and took its first lead at 49-48 on a dunkby Howard. But James scored two fast-break baskets — one on a slam — to give theCavaliers a 61-53 lead with 5:21 to play in the third quarter. The Cavs were up72-64 entering the fourth period, but the lead slipped away, with James andHughes on the bench.

Before the game, Stern discussed the NBA’s new China subsidiary, NBA China.Timothy Chen, one of China’s top business executives, began work Monday as thecompany’s new chief executive officer. Stern said long-term plans called forsetting up “the second NBA, the NBA of China.”

He didn’t specify what form that will take, but Stern said the expansionwill involve working with the 16-team China Basketball Association.

The NBA generated about $50 million in revenue last year from China, theleague’s largest market outside the United States. That pales compared withoverall NBA revenue of almost $4 billion. But NBA officials have said the80-person staff in China is set to grow five times in the next several yearswith increased revenues sure to follow.

Stern held two days of meetings in China talking with TV partners,advertisers and sponsors about ways to expand basketball in China.

He called the project “long term” and said the NBA was seeking financing.Ninety percent of the new subsidiary will be owned by the league. Two 5 percentshares will be sold to Chinese investors and to a U.S. media company.